Short Answer

A partner or majority owner may have discretion over whether a company makes distributions, but that discretion is not unlimited and does not answer every dispute. The operating agreement, tax allocations, solvency rules, past practice, manager authority, and treatment of other owners all matter. A stopped distribution may be legitimate if the company needs cash. It may also be part of a freeze out if insiders continue taking salaries, fees, loans, or benefits while one owner receives nothing. The financial records usually show which explanation is real.

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Tell Aaron what happened. When distributions stopped, what reason you were given, and what the agreement requires.

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What changes the answer

Profit is not the same as cash owed to you. Check who approves distributions, whether the agreement requires payments, and whether paying would leave the company unable to meet obligations.

For Florida LLCs, distribution rights follow chapter 605, Florida Statutes and financial limits follow chapter 605, Florida Statutes. Corporate distributions generally require board authorization and must satisfy chapter 607, Florida Statutes. General partnership profit rights follow the agreement and chapter 620, Florida Statutes.

Salary, loan repayments and management fees are reviewed separately, because a payment to the other owner is not always a distribution. A focused records request can help establish what was paid and why.

If circuit court relief is appropriate, identify the circuit. In Miami Dade County that is the Eleventh Judicial Circuit, in Broward County the Seventeenth, and in Palm Beach County the Fifteenth. The claim itself and the venue rules decide which court hears it.

Bring the agreement, financial statements, payment history, tax forms, compensation approvals and stated cash reserves. Identify any payment clause that has been triggered.

A general example

This is a general example, not a client matter. Two owners of a Miami wholesale LLC stop receiving quarterly distributions. The operating agreement permits reserves for inventory and requires both owners to approve changes in management fees. One owner says inventory costs justify retaining cash, but the ledger also shows increased fees paid to that owner's separate company. The other owner gathers invoices, reserve calculations and approval records. The review could support the reserve explanation, identify a disputed fee or lead to a negotiated payment arrangement. Whether an operating agreement was breached depends on those records, not simply the missing distribution.

Send the parties, the problem and the next date; the firm reviews every inquiry and tells you whether it can help.

For an LLC, review the agreement's statutory limits in chapter 605, Florida Statutes, distribution rights in chapter 605, Florida Statutes, and financial limits in chapter 605, Florida Statutes. A payment's label does not establish whether it is a distribution.

Corporate distributions follow chapter 607, Florida Statutes. Read that rule with the board authority and shareholder agreement qualification in chapter 607, Florida Statutes. General partnership agreements and profit allocations follow chapter 620, Florida Statutes and chapter 620, Florida Statutes.

The circuit counties appear in chapter 26, Florida Statutes. The general venue rule in chapter 47, Florida Statutes remains subject to its scope and any applicable special venue rule.

The example's reserve and fee approval clauses are hypothetical contract terms, not statutory defaults.

When This Becomes Urgent

What Usually Goes Wrong

Why Miami Experience Matters

In Miami companies, distributions often overlap with tax planning, owner salaries, management fees, real estate cash flow, and related businesses. A lawyer with local ownership dispute experience knows to reconstruct the full economic picture. The question is not only whether a check stopped. It is whether company value is being retained for a legitimate purpose or redirected so one owner benefits while another is squeezed.

Local proof: Little Lighthouse Foundation

What to Have Ready

• The operating or shareholder agreement and distribution provisions.
• K 1s, tax returns, bank statements, and distribution history.
• Owner compensation, management fees, loans, and related party payments.
• Budgets, cash flow projections, and explanations for retaining earnings.
• Any buyout proposal or communication tying distributions to a sale.

What Typically Happens Next

Counsel first determines who has authority to declare distributions and what limits apply. The records are then reviewed for consistency, solvency, tax treatment, and unequal benefits. The response may be a focused records demand, a governance challenge, negotiation over interim payments, or claims tied to fiduciary conduct or a freeze out. If the real dispute is an exit, distribution pressure becomes part of the valuation and buyout strategy.

Related Questions and Reading

• Can a Minority Shareholder Be Frozen Out in Florida?
• Can I Inspect the Company's Books and Records in Florida?
• Can I Force My Business Partner to Buy Me Out?
• partnership and shareholder disputes
• breach of fiduciary duty
• Browse all Ask Aaron answers

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Aaron Resnick has handled business disputes in Miami since 1998 and is a fourth generation Miami attorney. He works hands-on on every case; the client gets Aaron on every major litigation issue, not a junior partner. The Law Offices of Aaron Resnick represents business owners, partners, members and shareholders in Miami Dade, Broward and Palm Beach counties in partnership, LLC and shareholder disputes, buyouts and dissolutions. Call 305-672-7495 or request a consultation.